Managing M&O: 27th Annual M&O Cost Study

Results from AS&U's 27th annual M&O Cost Study

Current attention being focused on the deteriorating condition of America's school facilities has put the spotlight on past practices that have contributed to the present dilemma. Poor design and construction decisions made in the 1960s and 1970s by many school districts that wanted to get buildings up "fast and cheap" to meet burgeoning enrollments is the primary culprit. However, decades of deferred maintenance, insufficient building upkeep procedures, and years of siphoning dollars from maintenance budgets have significantly contributed to the current condition of our nation's schools.

According to American School & University's annual Maintenance and Operations (M&O) Cost Study, school districts allocated 9.40 percent of their net current expenditure (NCE) to M&O in the 1997-98 school year. While down slightly from last year's figure (9.59 percent), the percentage earmarked for M&O has dropped considerably from the 12.75 percent allocated in 1988.

Conducting the survey

Data for the 27th annual M&O Cost Study were compiled from an in-depth survey sent to approximately 5,000 chief business officers at public school districts with enrollments of more than 600 students. Each administrator was asked to document various M&O costs, including salary/payroll, energy, maintenance equipment and supplies, and grounds expenditures. Surveys returned without pupil enrollment data or gross area of district buildings were not used.

All surveys were analyzed, and the median number for each category (i.e., payroll, gas, electricity, outside contract labor, equipment and supplies, etc.) was identified on a national and regional level. In no case were regional medians added or averaged to arrive at the national figures. National medians were calculated by analyzing every survey in each category and identifying the median number. Be aware that the number of responses received from each region will directly affect final figures reported from year to year.

Survey data reported in the cost study identify budgeted expenditures for M&O per student and per square foot for the 1997-98 school year. Below are the categories used on the survey questionnaire:

-Budgeted: Amounts for the 1997-98 school year, reported as of the November 1997 survey deadline. *Per student: Based on enrollment (average daily attendance as of October 1997).

-Per square foot: Based on total gross area of all district buildings maintained, including corridors, common space and offices.

-NCE (net current expenditure): Total district expenditures, including teacher salaries, minus the cost of capital outlay, debt service and transportation.

-Total maintenance and operations expenditures: Including salaries, fringes, overhead, equipment and supplies, energy, utilities, outside contracts, etc., for maintenance, custodial and grounds.

-Custodial: Those individuals responsible for building upkeep and cleaning.

-Maintenance: Those individuals who perform skilled jobs, such as plumbing, HVAC or electrical repair.

-Grounds: Those individuals responsible for landscape maintenance and upkeep.

-Payroll: Including fringes.

-Average salary: Annualized, excluding fringes.

-Outside contract labor: Those hired for specialized jobs to maintain or repair building systems or equipment, such as HVAC maintenance or repair.

-Other fuel: Including oil and coal.

-Other utilities: Including water, telephone, etc.

-Other: Most often identified as equipment repair and rental, clerical costs, trash removal, insurance and travel expenses.

In comparing your M&O expenditures with the regional and national medians reported, keep in mind that all costs are greatly affected by the labor market in an area, the age and overall condition of buildings, climate, as well as other factors over which school administrators have limited control. In addition, because medians are used and the majority of the nation's school districts-and respondents to the survey-are small- to medium-size (median student enrollment of 2,000), large systems will need to take this into consideration when reviewing results.

Survey highlights

The charts and graphs that follow identify M&O costs on a regional and national basis. The survey found that, at the national level, the median public school district has 12 full-time custodial, four full-time maintenance and two full-time grounds personnel. In addition, the amount of square feet maintained per custodian is slightly lower than what was reported in last year's survey. On the national level, 20,612 square feet of building space is maintained per custodian (compared to 20,936 last year).

Two of the three salary positions surveyed-custodial and grounds-increased slightly over what was reported last year. The national median salary for custodial personnel is $21,167 (up 1 percent) and $23,030 (up 1 percent) for grounds personnel. The national average salary for maintenance personnel is $26,673, a 3 percent drop from what was reported last year. In addition, 17 percent of school districts report that they contract out M&O services to a private firm.

More is being spent by school districts on transportation in the 1997-98 school year. The median district spends 4.2 percent of its total annual expenditures on transportation ($269.41 per pupil). These figures further support the trend seen over the last few years of rising school transportation costs, reflecting additional expenditures many systems are incurring in busing a rapidly growing school-age population and more special-needs students.

Breakdowns by region

The highest costs in the majority of per-student and per-square-foot categories are reported in Region 2, including the highest per-student expenditures for custodial and grounds payroll, gas, grounds equipment and supplies, total M&O, total NCE, transportation, and grounds salaries. It had the highest per-square-foot costs for gas and total M&O, and tied for highest grounds equipment and supplies expenditure.

Region 9 had the highest per-square-foot costs for custodial, maintenance and grounds payroll; other utilities; total NCE; and tied with Region 2 for highest g rounds equipment and supplies cost.

Other regions reporting the highest costs include Region 1 (custodial and maintenance salary, and per-square-foot cost for other fuel), Region 4 (number of square feet maintained per custodian, number of acres maintained per grounds worker, and per-square-foot costs for outside contract labor), Region 8 (per-student costs for other fuel, maintenance equipment and supplies, and M&O as a percent of NCE), Region 3 (per-student and per-square-foot costs for electricity and transportation costs as a percent of total district expenditures), Region 5 (per-student costs for outside contract labor and other), Region 6 (per-student cost for maintenance payroll and per-square-foot cost for other), and Region 10 (per-student cost for other utilities, and per-square-foot cost for maintenance equipment and supplies.)

Region 4 reported the lowest expenditures in a majority of categories, including per-student costs for custodial and grounds payroll, other utilities, other, total M&O, M&O as a percent of NCE, and custodial salary. It had the lowest square-foot costs for custodial payroll, other utilities, total M&O, and tied with Regions 3 and 1 for grounds equipment and supplies.

Region 8 posted the lowest grounds salary, per-student cost for total NCE, and per-square-foot costs for grounds payroll, outside contract labor, electricity, other and total NCE. Region 9 had the lowest per-student costs for outside contract labor, gas, electricity, maintenance equipment and supplies, and transportation cost per student and as a percent of total district expenditures. It also reports the fewest amount of acres maintained per grounds worker.

Other lows are reported in Region 1 (per-student cost for grounds equipment and supplies, per-square-foot cost for gas, and tied with Regions 3 and 4 for lowest per-square-foot cost for grounds equipment and supplies), Region 6 (maintenance salary, square feet maintained per custodian, and per-square-foot cost for maintenance equipment and supplies), Region 5 (per-student and per-square-foot costs for other fuel), Region 7 (per-student and per-square-foot costs for maintenance payroll) and Region 3 (a tie with Regions 1 and 4 for per-square-foot cost for grounds equipment and supplies).

What it all means

The AS&U cost study has served as a benchmark for educational institutions for the past 27 years. Often, the magazine is asked if the figures in the cost study are considered to be ideal. Our reply is that all they are is what is reported. And, if past practices and current conditions tell us anything, it is that perhaps the amounts allocated to M&O are not enough to provide the nation's children with the best possible learning environments.

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